Over-indebtedness: how the law, financial education and other initiatives are helping Brazilians turn the tide
Over-indebtedness is a real challenge for many Brazilian families, but it is also an opportunity to rethink habits, seek support and regain control of their financial lives. In this spirit, on July 1, 2021, the following legislation was signed into law Law No. 14.181/2021, known as the Over-indebtedness Law. This legislation strengthens consumer rights and offers concrete paths for those who wish to reorganize their finances with dignity and security.
The law allows consumers to renegotiate their debts by means of plans that respect the existential minimum, the amount needed to cover basic expenses such as food, housing and health, currently set at R$ 600.00. In addition, it combats abusive practices in the offer of credit and encourages financial education, promoting a fairer and more balanced environment for all.
According to the Central Bank, in March 2025, household indebtedness stood at 48.6% of income accumulated over the last 12 months, and the commitment of income to debt service was 27.2%. These figures show that, although the challenge persists, there is room for improvement and several projects are already underway to support Brazilian citizens.
An inspiring example comes from the São Paulo Court of Justice (TJSP), which launched the State Program to Combat Overindebtedness. The initiative brings together public authorities, companies and financial institutions to offer mediation between consumers and creditors via a digital platform. The aim is simple and powerful: to facilitate fair agreements that allow debts to be settled without compromising quality of life.
The program has the support of the credit bureaus Quod, Serasa and SPC Brasil, as part of the National Association of Credit Bureaus (ANBC). This joint effort strengthens the culture of conciliation and shows that it is possible to transform challenges into sustainable solutions.
10 attitudes to keep your financial health in check
With small changes in habits and more information, it is possible to avoid over-indebtedness and build a more peaceful financial life. Here are some practical tips:
1. Organize your finances: write down income, expenses and due dates. Clarity is the first step towards balance.
2. Avoid overdrafts and revolving credit cards: prefer options with lower interest rates.
3. Renegotiate your debts: dialog with creditors can open the door to better conditions.
4. Consume consciously: prioritize the essentials and avoid impulse purchases.
5. Save whenever you can: even small amounts make a difference in the long run.
6. Avoid taking on too many debts at the same time: this helps you stay in control.
7. Research before taking out credit: compare rates and terms.
8. Don't lend your name: avoid taking on third-party debts.
9. Beware of long installments: they can jeopardize your future budget.
10. Invest in financial education: the internet has a lot of free material available with important tips on the subject, such as the websites of credit bureaus and ANBC itself.
